Remarks of Tony Tyler on the State of the Industry, Cape Town

It is a truth that has been with us for thousands of years. Since Aesop’s first fable, it has inspired change, revolution and forbearance in the face of adversity.

On 1 January 2014 we will celebrate 100 years of commercial aviation (1). Even for our relatively young industry this age-old truth has enormous relevance. Aviation is fiercely competitive. But, working together, strong partnerships, global standards and cooperation have played a major role in our success, and they still do.

Safety

One of the longest standing partnerships between industry and governments is on safety. Flying is safer than ever.

Last year there was not a single hull loss with a Western-built jet (2) among our 240 member airlines or among the 387 airlines on the IATA Operational Safety Audit (IOSA) registry (3).

There is still more work to do. If we include all aircraft types (4), 2012 saw 75 accidents and 414 fatalities (5). These remind us of our great responsibility to those who trust us with their lives. And each accident re-dedicates both industry and governments to making flying even safer.

Geographically, the biggest challenge is Africa where the accident rate is 18 times worse than the global average (6). But the safety performance of African airlines on the IOSA registry, including our African members, aligns with the global average (7).

This means that world class safety is possible in Africa. With the Abuja Declaration (8), African governments have committed to achieve world class levels by the end of 2015. By then IOSA will be required across the continent (9). As partners, we are engaging African airlines directly to meet IOSA’s over 900 standards and join the registry.

And I hope that the European Union (EU) will be watching the results. Its banned list has not helped African safety (10). I am confident that IOSA will lead to improvements. And the EU will have no choice but to rethink its misguided approach.

Financial Performance

Compared to our safety performance, aviation’s ability to generate sustainable returns has been more challenging. This year we expect airlines to make $12.7 billion profits. On $711 billion in revenues, that’s a 1.8% net profit margin (11). And to put that into perspective, it means that we will earn a $4.00 (12) profit per passenger carried—less than the price of a sandwich in most parts of the world.

Generating even these small profits under current conditions is a major achievement. The price of fuel, our largest cost item, has increased 55% since 2006 (13). And we continue through the greatest period of economic stress since the 1930s.

Airlines have attacked costs and improved efficiencies. Industry programs such as e-ticketing, have contributed to the effort. This helped to keep unit cost increases to 23% (14). Intense competition means that fares have been unable fully to recoup cost increases.

So where are the profits coming from?

Airlines found new value streams. Ancillary sales have grown to over 5% (15) of revenues.

And capacity is being used more efficiently. The industry load factor is at a record high of 80.3%.

But, business is still tough. The day to day challenges of keeping revenues ahead of costs remain monumental. Many airlines are struggling. But there is a core of airlines that are driving profits with solid performance.

Our investors should be excited about the industry’s potential. With 3.1 billion (16) people and more than 52 million tonnes of cargo (17) expected to fly this year, air transport is a growing part of the fabric of modern life. Our activities generate some 57 million jobs (18), support $2.2 trillion in global business (19) and facilitate $6.4 trillion in trade (20). Looking ahead, the Asia-Pacific market could triple in size over the next 20 years (21). And you can only imagine the potential of Africa.

In our first 100 years aviation connectivity has recalibrated humanity’s mindset to a global scale. In doing so, aviation has enriched our world. The future is pregnant with potential. But it also holds many challenges.

Partnerships are critical to take advantage of the potential and to overcome the challenges. Successful partnership is built on transparency and common purpose. And sometimes frank words are required to strengthen alignment. I see five areas where this is needed today:

Security

Infrastructure

Distribution

Regulation, and

Environment.

Improving Security

Starting with security, there is good alignment on what needs to be achieved. Our customers don’t want anything to do with terrorists or their weapons. Airlines don’t want them on their aircraft. Airports don’t want them on their premises. And governments don’t want them in their country.

What we lack is alignment on how to achieve this. There is, however, a growing recognition that a one-size-fits-all approach is wasteful and unsustainable. The vast majority of passengers and cargo pose no threat at all. So, we are working in partnership with governments on two key data-driven risk-based initiatives.

Secure Freight (22) has proved that a supply chain approach works. Six countries (23) have followed a successful pilot in Malaysia. And more will follow.

A framework for the Checkpoint of the Future (24) has been agreed and component testing is progressing. Passengers can expect to see the first versions operational as early as next year (25).

Despite this good progress, we must also be open with our government partners about our frustrations. Lack of harmonization is the issue. For example:

Governments agreed on an Advance Passenger Information (API) (26) standard which has been endorsed by the International Civil Aviation Organization (ICAO) (27). But that hasn’t solved our issues with API. Seven (28) of the 42 states requiring API don’t use the standard. And at least five more are considering unique requirements. On top of that, the UAE and Canada require airlines to provide data – then charge them lots of money for doing so (29).

Similarly, despite agreement on the principles for one-stop-security being long-established, we only see progress in a few regions (30). If you screen passengers thoroughly and keep them in a sterile environment, a second check is a waste of resources. So why aren’t more states moving more quickly in this direction?

Governments work together with trust and cooperation on safety. It’s time to apply the same approach for security to achieve a harmonized, efficient and effective outcome.

Cost Effective and Efficient Infrastructure

Looking beyond security to overall infrastructure, partnerships also play a key role. Airlines depend on airports, air navigation service providers (ANSPs) and ultimately governments to ensure sufficient infrastructure capacity at economic prices.

Many understand that connectivity is a strategic economic driver—Singapore, China, Chile, the UAE, South Korea, Hong Kong and so on. It’s a familiar list of well-connected economies thriving with excellent airport infrastructure.

But what’s happening in other parts of the world drives me mad with frustration. And you too, I’m sure.

The Single European Sky (SES) (31), for example, is not materially any closer to realization today than it was a year ago. In fact, you would have to be an extreme optimist to identify much progress at all over the last ten years. The European Commission understands the value that SES would bring. But EU member states are paralyzed by wrongly perceived national interests. And this is robbing Europe of the economic and environmental benefits that SES could deliver—a EUR 5 billion boost to competitiveness (32), eradication of nearly 18 million minutes of delay (33), an 8.1 million tonne reduction in carbon emissions (34) and the capacity to support economic growth efficiently.

What’s needed? Several things:

A binding performance scheme with an independent regulator (35)

Competition among providers (36)

A reduction in air traffic control centers from 63 to at most 40 (37), and

Guaranteed performance improvements using modern technology (38)

NextGen in the US has taken too long to get off the ground as well (39), but it is finally gaining momentum. And the Seamless Asian Sky (40) initiative is seeking air traffic management solutions in advance of the situation becoming critical. Every year that SES is delayed, the gap with the rest of the world grows. And the solutions required become bigger and more complex.

Europe is also home to one of our biggest airport problems—Heathrow. And I am not even referring to the capacity issue. The UK Civil Aviation Authority (CAA) has an enhanced mandate to protect the interests of passengers. To fulfill this, the CAA is proposing a Heathrow price cap of 1.3% below inflation for the next five years (41). This sets an important precedent. But even at that, it is weak medicine for a major illness. Capping prices at inflation minus 9.8% is possible if the airport and regulator focus on efficiency (42). And Heathrow’s response has not been what you would expect of an important business partner.

Disappointingly, and in a way only possible for a monopoly, it is threatening to cut capital expenditure to the detriment of service levels and operational resilience instead of getting serious about efficiencies.

Through ICAO governments have agreed on common sense principles to guide the critical partnership between airports, airlines, and governments on infrastructure (43). Infrastructure users—the airlines—should be engaged in transparent consultations so that what is built matches what is actually needed and at affordable costs.

It sounds simple, but there are plenty of examples to show how misalignment can turn fantastic partnership opportunities—like Heathrow—into a constant struggle on cost, service levels and capacity. When airlines, airports, ANSPs and governments work together, everyone benefits. And pragmatic government regulation can ensure that this happens systematically.

NDC

Cooperation among partners is also the basis for solving common problems. As everyone in this room knows, our passengers would benefit from modernizing airline distribution. Today’s reality is that travelers have one set of product options if they buy on an airline website. But if they choose to buy through our travel agent partners, the options are limited.

Agents get their offers from airlines via global distribution systems (GDSs) (44). Despite attempts to enrich content, GDSs struggle to communicate much more than the basics of fare, class and availability. That’s because the standards for the communication among these parties were developed before the internet and XML—today’s lingua franca for modern commerce.

To remedy the situation we are working with our travel industry partners to develop open XML standards that will enable a new distribution capability (NDC) (45).

The NDC foundation standard was agreed in late 2012. It’s been submitted to the US Department of Transportation (DOT) (46) for approval. And we are actively engaging regulators around the world to ensure that there is a clear understanding of the value that NDC will bring to the experience of buying travel though an agent—more choices, better quality information and the potential for personalized offers.

However, we are not without opponents. And, frankly, some of them are not telling the truth. Let me clear the air with some facts.

NDC will not contravene privacy laws. Nothing in the NDC standard requires passengers to supply personal information to receive an offer. But it does provide the opportunity for customers to identify themselves to have their loyalty recognized by the airline – but only if they choose to do it.

NDC will not bypass travel agents. It will enable them to sell all of what airlines have on offer.

And, lastly, NDC will not eliminate comparison shopping. It will give customers better information on which to make decisions. NDC will support photographic product descriptions so that people can see what they are buying. And it will enable passengers to compare the base fare as well as the cost of all the options that are available.

Momentum is building. We have a mock-up in the exhibition area. Please go and look at it. You’ll be able to see the kind of features NDC could enable for travel agents and their customers. The first pilots will be live before the year-end. Amadeus has expressed its support for the stated objectives of NDC, although it has some concerns about the Resolution (47). And Travelport has said that it will work with airlines that want to distribute products via NDC standards (48).

Later today, a resolution on NDC, if passed, will provide further clarity to governments and industry partners on our aims, objectives and commitment to change.

Establishing appropriate regulation

Partnerships with the travel industry are changing distribution for the better. We need similar partnerships with governments to change regulation for the better.

We have already shown that this is possible with safety regulation that underpins solid performance. But not all regulation delivers value.

What’s needed is a Hippocratic Oath for regulators. The first principle would be to do no harm—intended or unintended. And every regulator should take an oath to solve problems, take full advantage of expert advice, evaluate costs and benefits; and ensure global harmonization.

Some recent regulatory developments already align with this. For example we have seen regulations in Russia, India and Poland (49) that increase competition among airline suppliers at airports. And progressive liberalization is creating new opportunities for airlines to meet market needs.

But on passenger rights, regulators are getting it wrong.

It is a strange paradox: We are a service industry that operates in a hyper-competitive environment. Yet governments feel they need to protect our customers from us. It is totally appropriate that governments set some simple guarantees. But that’s not what’s happening. Regulators—the guardians of competition—are micro-managing our businesses. And the rules can be so prescriptive that they stifle innovation. We have regulations that define:

How we advertise our services (50)

How long we must hold a reservation that has not been paid for (51), and

How we compensate and care for passengers when there are operational disruptions—regardless of the root cause (52)

Most passenger rights regulations are centered on levying penalties or preventing activities rather than providing solutions. For example, we have different rules on how to compensate passengers for delays. But where are the regulations to fix the air traffic management issues that cause so many delays?

Already some 50 countries have passenger rights legislation (53). They are not aligned. And the bad news is that more states are considering joining in this daunting and diverse mess.

Overzealous regulation causes significant difficulty in domestic markets. And un-harmonized regulations can cause utter confusion for international travelers. Being delayed on a disrupted trip from the US to Israel via Europe is bad enough for passengers. Regulation shouldn’t make things even worse by presenting them with a bewildering array of three conflicting passenger rights regimes (55).

It is unrealistic to think that governments will fix the situation anytime soon. I’m afraid our vigorous objections haven’t got us very far. So, industry needs to provide a fresh solution. Later this morning we will consider a resolution on a set of core principles for passenger rights.

If agreed, this will become a valuable tool to guide governments in harmonizing their various regimes. And it would be the centerpiece of an industry–wide campaign to help regulators recalibrate their impression of what the air travel experience is, and how it could be even better.

We want regulators to understand that travelers are our customers. And we want customers to have the best possible experience, because our businesses depend on customers coming back.

Environment

Even more critical is the urgent need to address fast moving developments in the environment debate with a strong industry position.

As a global industry, aviation is already in the forefront. We recognize that reducing carbon emissions is a global challenge. And to be successful we know that we need global measures.

That’s why we united behind a global strategy based on improvements in technology, operations and infrastructure along with market-based-measures (MBMs) as a gap-filling measure. And, at the ICAO Assembly in 2010 governments agreed to important global and aspirational goals including carbon-neutral growth from 2020 - or CNG2020 (56) as we call it.

Make no mistake. Our unity has delivered some major successes. We worked with industry partners to demonstrate that sustainable low-carbon fuels, including biofuels, are a real alternative to jet kerosene. And we are now pushing governments to provide the incentives needed for investors and our oil industry partners to be able to commercialize production at costs we can afford.

Unity also helped us to fend off the misguided attempt to bring international aviation into the EU Emissions Trading Scheme (EU ETS) (57). Europe stopped the clock at the end of 2012, creating the space for countries to agree on a global approach for MBMs through the ICAO process.

MBMs are critical to meeting our targets. Technology, operations and infrastructure improvements will not be enough for CNG2020, at least in its early years.

The ICAO Assembly this year will determine the way forward. It is a big challenge. And governments are asking us—as an industry—to present a common position to guide their deliberations.

Over the last two years IATA’s Climate Change Task Force (58) has taken up the challenge of forging that common position. But it is as much of a struggle for airlines as it is for governments.

The question is this. Can we, airlines, agree on a way to share the industry emissions bill, which, I must remind you, amounts only to the cost of the post-2020 growth? Or would we prefer to let governments around the world decide how to make us pay for all our emissions?

I know how I’d answer that, but you will be discussing it later this morning.

How should we divide up the industry bill? Is it fair that a smaller but growing airline should have to pay more than a much bigger airline, just because the bigger one got its growth in before 2020?

But would it also be fair if an airline which is not growing has to pay something, when the industry bill is calculated on the basis of growth?

Reasonable people can disagree about the answers. But if we cannot find a compromise we will lose a golden opportunity to give governments the guidance that many of them are asking us for. That means bridging the gap between those who say we should divide the bill based on your share of total emissions, and those who say we should divide the bill based on your share of growth.

As with any compromise, nobody will get everything that they want. But consider carefully the potential consequences of the alternative—the infamous patchwork horror story that will certainly unfold.

If we don’t agree, governments will decide on our behalf. Some will impose environmental taxes. The UK, Germany and Austria (59) already have. Others may focus on total emissions rather than just growth. A few may do nothing—an option that also creates competitive distortions. And others might find even more expensive ways to penalize emissions —possibly in ways that are completely disproportionate to our emissions contribution.

Without a united industry position we would cede the opportunity to influence governments on MBMs. And, we leave ourselves defenseless to fight what governments might come up with.

Now there’s no guarantee that what we say we want will be implemented. But if we don’t say what we want it’s certain we won’t like the outcome.

Governments are struggling to find a solution. And many are asking for our guidance. With these considerations, it is painfully obvious that it is in our individual and collective interests to let those governments know the direction in which we would like them to move.

Later today a resolution on sharing the burden of carbon-neutral growth will come before this assembly. As the leader of your association, I urge all in this room to maintain industry unity and support it. As partners, it’s time to focus on the common good. United we stand. Divided, we will all fall.

Conclusion

Ladies and gentlemen, I have to report that the state of global air transport remains challenging. Nevertheless, we are a resilient and robust industry with an important role in global development.

The 8.5 million people (60) and 143,000 tonnes of cargo (61) that are carried safely by air everyday are proof that aviation is integral to modern life and commerce. Connectivity drives economic growth. We bring products to markets, link people to business and reunite families and friends. We are truly a force for good.

Airlines compete vigorously to defend and grow their businesses. At the same time we have a strong association born in the recognition that a successful global air transport industry needs global standards. And that these standards must be built through compromise, partnership and cooperation.

The first century of commercial flight is marked by impressive achievements. Together, we will continue to face our many challenges. And united we will deliver many more successes—sustainably connecting and enriching our world as an industry that is ever safer, more secure and profitable.

Thank you.

Foot notes

1 - Tony Jannus piloted the first recorded scheduled commercial airline flight between St. Petersburg and Tampa, Florida, 1 January 1914. The name of the airline was the St. Petersburg-Tampa Airboat Line.2 - A hull loss is an accident in which the aircraft is destroyed or substantially damaged and not subsequently repaired for whatever reason including a financial decision by the owner. For 2012, the Western-built jet hull loss rate was 0.20 per million sectors flown, the equivalent of one accident every 5 million flights. This represented a 46% improvement over 2011, when the accident rate was 0.37 or one accident for every 2.7 million flights. IATA members recorded no Western-built jet hull losses in 2012, nor did airlines on the IOSA register.3 - The IATA Operational Safety Audit (IOSA) is the first global industry standard for airline operational safety auditing. It is a requirement for membership in IATA. 4 - This includes Western-built and Eastern-built multi-engine turbine-powered aircraft with a certificated MTOW of at least 5,700KG (12,540 lbs) for turboprops and 15,000KG (33,000lbs) for jets.5 - The total number of accidents declined 18% between 2012 and 2011 (75 vs. 92). The total number of fatalities declined 15% (from 486 to 414).6 - The Western-built jet hull loss rate for African carriers was 3.71 compared to 0.20 for the industry. 7 - African airlines on the IOSA registry experienced zero accidents last year.8- In May 2012, IATA, together with the International Civil Aviation Organization (ICAO) and a host of other organizations committed to an Africa Strategic Improvement Action Plan aimed at addressing safety deficiencies and strengthening regulatory oversight in the region by 2015. The Plan was endorsed as part of the “Abuja Declaration” by the Ministerial meeting on Aviation Safety and Security of the African Union in July 2012.9 - The Africa Strategic Improvement Action Plan calls for completion of an IOSA by all African carriers. The plan was included in the Abuja Declaration that was endorsed by the African Union Executive Council in January 2013.10 - The European Union list of banned airlines, first drawn up in March 200611 - Net profit margin. Profits net of tax, debt interest and other financial transactions as a % of operating revenue.12 - $12.7 billion divided by 3.13 billion passenger enplanements13 - The similar point of the previous industry business cycle14 - Comparing level of unit costs 2013 vs 200615 - 2012, IdeaWorks 2012 reported ancillary revenue total as 5% of operating revenue. This is forecast to grow in 2013.16 - IATA June 2013 Industry Financial Forecast. Note ‘people’ here means passenger enplanements and not separate individuals.17 - IATA June 2013 Industry Financial Forecast.18 - Aviation Benefits Beyond Borders, ATAG March 2012.19 - Aviation Benefits Beyond Borders, ATAG March 2012.20 - World Trade Organization. 2011 merchandize exports * 35% flown by air (The Colography Group)21 - Standard Chartered Bank ‘Super Cycle Report’.22 - Secure Freight guidance material has been recognized by the United Kingdom and Australian authorities, the European Commission, and by the World Customs Organization.23 - Kenya, Mexico, Chile, Egypt, the UAE and Jordan.24 - A conceptual framework has been documented in 3 Checkpoint of the Future blueprints (2014, 2017, 2020). This roadmap to 2020 has been recognized as a “useful tool” at the ICAO High Level Conference on Aviation Security in September 2012.25 - Two airports will be selected to participate in demonstrations of the first generation Checkpoint of the Future in 201426 - API information usually consists of data found in the Machine Readable Zone (MRZ) of passports and other travel documents (full name, date of birth, gender, passport number, country of citizenship, country of passport issuance). However, some countries require information that cannot be machine-read. IATA's aim is to ensure that all countries requiring API-type data harmonize their requirements with global standards and guidelines.27 - Guidelines that states are to follow when implementing API were established through the World Customs Organization including adoption of the UN-EDIFACT PAXLST message as the standard for data transmission when States implement legacy batch-style API programs. ICAO fully aligned with the output when the Guidelines and message standard were updated in 2003 – making the document the WCO/ICATA/ICAO Guidelines on API. Additionally, ICAO adopted language in Annex 9 – Facilitation during the April 2004 ICAO Facilitation Division calling upon states to follow the WCO/IATA/ICAO Guidelines on API when implementing such programs. That language (Standard 3.47) was further strengthened in the 6th FAL Panel held in 2010. 28 - China, India, Fiji, Mexico, Ukraine, Haiti, and Russia have non-standard requirements. Bangladesh, Bolivia, Hungary, Nigeria and Poland are considering introducing them.29 - In the case of Canada, the charges include a one-time fee of approx. CAD 25,000 to link the airline (or Service Provider) system to the government system, and then an annual “maintenance” fee of approximately CAD 5000. The UAE has implemented a “per passenger” API fee that airlines or travel agents collect at time of ticketing.30 - One-stop security was approved by the European Commission (EC) some 12 years ago but has to be adopted on an airport-by-air¬port, nation-by-nation basis in the European Union (EU). It is already in place for flights with¬in the EU and, unilaterally, for flights from the United States to Europe. Additionally, one stop security pilot projects were conducted in Panama and El Salvador. Canada, Australia and Qatar are also among states making progress.31- The Single European Sky is a project led by the European Commission, by which the design, management and regulation of airspace will be coordinated throughout the European Union. 32 - 2011 Performance Review Report (PRR) http://www.eurocontrol.int/sites/default/files/content/documents/single-sky/pru/publications/prr/prr-2011.pdf: En route delays (€900 million); Route extensions (€1930 million); Airport delays (€550 million); Arrivals holding and sequencing (€950 million); and Taxi out (€850 million). 33 - 2011 PRR.34 - 2011 PRR.35 - A Blueprint for the Single European Sky published by IATA, the Association of European Airlines and the European Regions Airline Association, February 2013. http://www.iata.org/pressroom/pr/Documents/blueprint-single-european-sky.pdf36 - A Blueprint for the Single European Sky.37 - A Blueprint for the Single European Sky.38 - A Blueprint for the Single European Sky.39 - The Next Generation Air Transportation System (NextGen) is a United States Federal Aviation Administration-led project to transform America’s air navigation systems from a ground-based to a satellite-based system. 40 - The Seamless Asian Skies’ primary objective is to increase airspace and infrastructure capacity by standardizing services, harmonizing regulations, and ensuring interoperable ATM across the Asia-Pacific region. 41 - Since 1986, the UK Civil Aviation Authority has conducted quinquennial reviews of the pricing controls at airports deemed to have a certain level of market power. The latest review at Heathrow, Q6, covers the period 2014-2019. 42 - Heathrow London Airline Consultative Committee/Airline Operators Committee submission to CAA, 20 Feb 13.43 - ICAO Airport Economics Manual http://www.icao.int/sustainability/Documents/Doc9562_en.pdf.44 - There are three major global distribution systems (GDSs) providers outside of China. GDSs aggregate airline price, schedule and fare information for use by travel agents and online travel agencies.45 - Resolution 787, which creates the Foundation Standard for NDC, was adopted by the Passenger Services Conference in October 2012.46 - Under the “Provisions for Conduct of IATA Traffic Conferences”, IATA is required to file any and all resolutions and agreements coming out of its various conferences with the US Dept. of Transportation. IATA filed its application in March 2012.47 - Amadeus has identified four specific areas it would like DOT to address: The Resolution should be entirely non-binding and voluntary; references discouraging backwards compatibility should be removed and provisions to enable content comparison should be included; references to content ownership should be removed from the resolution; Privacy issues should be clarified.48 - Travel Market Report, 13 April 2013.49 - In Russia a 2009 decree enabling competition for the supply of jet fuel and provision of handling services at Russian airports, has resulted in fuel prices reducing to competitive levels at most key airports. A campaign to achieve competition in jet fuel supply at Indian airports resulted in the government’s decision to provide open access to supply infrastructure controlled by state-owned suppliers at Chennai and Kolkata airports by March 2013. The airport operator in Warsaw, PPL, has launched a tender to identify a concessionaire for the design, construction, financing and operation of jet fuel infrastructure. 50 - Example: In the Philippines, disclosures such as conditions attached to the fare type, baggage allowances, refund and re-booking policies shall occupy not less than 1/3 of the advertising material.51 - Example: USA Consumer Rule II – Carriers are required to hold the reservation for 24 hours (if the consumer makes the reservation one week or more prior to a flight’s departure).52 - Example: EU Regulation – prescribes compensation/care and assistance for passengers depending on the length of the flight or the delay. For example, carriers had an obligation to provide care and assistance to passengers during the Volcanic Ash incident in 2010, when airspace was closed.53 - Argentina, Austria, Belgium, Bolivia, Brazil, Bulgaria, Chile, China, Colombia, Cyprus, Czech Republic, Denmark, Ecuador, Estonia, Finland, France, Germany, Gibraltar, Greece, Hungary, Iceland, India, Ireland, Israel, Italy, Jordan, Latvia, Lithuania, Luxembourg, Macau, Malta, Mexico, Netherlands, Nigeria, Norway, Pakistan, Paraguay, Peru, Philippines, Poland, Portugal, Romania, Russian Federation, Saudi Arabia, Slovakia, Slovenia, Spain, Sweden, Switzerland, Thailand, Turkey, United Kingdom, United States, Uruguay and Venezuela.54 - Examples of countries include Kenya, Kuwait, Jordan, South Korea, Dubai (passenger rights are regulated at Emirate level in the UAE), and Jamaica.55 - Israel: For delays of 2 hours or more, passengers are entitled to food, drink and communication services. In cases of delay between 5 and 8 hours, passengers are entitled to reimbursement of the ticket price or a replacement ticket (i.e. rerouting). Where a replacement ticket has been accepted, a carrier must provide any necessary accommodation and incidental ground transfers.EU: Passengers who arrive at their destination 3 hours or more after their originally scheduled arrival time are entitled to compensation under Article 7(1).USA: If a tarmac delay extends to 3 hours (for domestic flights) or 4 hours (for international flights), the carrier will be subject to fines.56 - Assembly Resolution on International Aviation and Climate Change: www.icao.int/environmental-protection/Documents/STATEMENTS/sbsta-33_Item-6a.pdf57 - In 2008 the European Union adopted legislation on including all flights to and from EU airspace into its Emissions Trading Scheme. http://ec.europa.eu/clima/policies/transport/aviation/index_en.htm. 58 - The Climate Change Taskforce of airline and regional association experts was established by IATA to explore options for how to operationalize carbon-neutral growth 2020.59 - UK Air Passenger Duty was first imposed in 1994 and in 2012 raised $3.9 billion (2.6 billion GBP); the German Passenger Departure Tax was imposed in January 2011 and in 2012 raised $1.23 billion (948 million EUR); the Austrian departure tax was imposed in April 2011 and in 2012 raised $139 million (107 million EUR).60 - Based on estimated 3.1 billion people flying in 2013.61 - Based on forecast 52.1 million tonnes of freight carried in 2013.